Sellers: Here's How to Successfully Negotiate Your Broker's Fee1. Use leverage. If you're selling your home and buying a new one at the same time, ask your broker if they'll offer a lower commission in exchange for using their services on both transactions. The same goes for selling an "in-demand" property: If your house is in a good school district and you know it will sell quickly, ask your broker for a commission reduction.

2. Go with a smaller firm. The smaller a company is, the less red tape your realtor has to go through in order to get permission to discount his or her fee, Michael says. That's because the broker's firm typically takes half of his or her commission.

3. Consider the alternatives. If one broker refuses to negotiate, remember there are thousands of others out there. Some, like New York- and New Jersey-based discount brokerage Foxtons, offer full-range services at a fixed 4% rate. The savings, according to Les Newlands, a senior vice president at Foxtons, come from lower overhead expenses, as the firm's brokers have virtual offices.

Buyers, There's Savings in Store for You, TooDon't be shy to ask your broker for a cut of his commission, especially if you found the listing yourself (not an unlikely scenario these days, as buyers increasingly start their home search online). Just keep in mind that some states prohibit brokers from offering rebates, although their number has decreased in recent years as the Department of Justice (DOJ) seeks legal action against such regulations, alleging they restrict competition among brokers. The 10 states that still have such rebate bans, according to the DOJ, are Alabama, Alaska, Kansas, Louisiana, Mississippi, Missouri, New Jersey, North Dakota, Oklahoma and Oregon.